Executive Hire News › Archives › August 2009 › City News : Positive signs at Speedy
City News : Positive signs at Speedy
Catherine Stratton considers Speedy's AGM announcement.
July was a good month for Speedy. Its shareholders accepted 92.37% of its £100m rights issue, with the company’s brokers able to place the rump at 24.5p per share. In the rights issue document Speedy indicated that as well as strengthening its capital base and reducing its net debt, it would be using the rights issue proceeds to “assist the Group in achieving its strategic objectives, including product and geographic expansion, targeted acquisitions of customer fleets, and further development and establishment of new customer relationships.”
Speedy’s first major announcement after the rights issue came on the day of its AGM (21 July) and seemed to fit at least two of the objectives. It announced a Memorandum of Understanding with Al Futtaim Carillion, Carillion’s long-standing joint venture in the Middle East, for Speedy to provide equipment, asset management and site support services. Chief Executive Steve Corcoran commented, “we see attractive long term growth opportunities in the region and are delighted that this MOU provides an opportunity for us to extend the scope of our activities with Carillion outside the UK.”
Speedy has built a strong relationship with Carillion in the UK. In May 2008, it acquired the portable accommodation business of Carillion Asset Management and entered a five year Strategic Partnering Agreement, which reinforced the hirer’s position as the Carillion Group’s preferred supplier of its full range of products. This January, a Speedy ‘implant team’ went to the UAE to work with Carillion’s local management to gain a better appreciation of its business and to assist in the Group’s development in the region.
Steve Corcoran says that this agreement is the outcome of Speedy’s strategy of building relationships with customers to help them to bring about cost savings and greater efficiencies. Speedy now has a platform in the Middle East that it can use to serve not only Carillion, but also other UK contractors. Both powered access specialist Lavendon and pumps/heating specialist Andrews Sykes have established thriving hire businesses in the Middle East and it looks potentially to be a strong market for Speedy. Steve Corcoran thinks Speedy should be generating revenues there in excess of £10m within two years.
At the AGM, Speedy Chairman David Wallis told shareholders, “challenging conditions…remained, although in recent weeks there have been some signs that trading is beginning to stabilise.” • |
